Graduation present: a clean carbon slate
Alex from WorldChanging sez, "We weren't satisfied with the bogus "green" graduation gifts being hawked out there, so we decided to create the ultimate one.
For a gift of $6,000, we'll offset the climate emissions of your favorite high school grad's whole childhood, giving them a carbon clean slate.
It's only $7,500 for a college graduate.
Expensive? No, discounted. The point is our impacts are much to big to change with some hemp sandals or a solar backpack, and it's time to get real."
Link
(Thanks, Alex!)
the latest
latest episodes
Today's Toothpaste for Dinner: http://www.toothpastefordinner.com/050908/carbon-credits.gif
"The point is our impacts are much to [sic] big to change with some hemp sandals or a solar backpack, and it's time to get #### rich off the suckers."
Fixed that for you, Cory.
Yeh, I saw a few reports on some BBC and Channel4 current affairs shows, that show carbon-offsetting was as bona fide as selling plots on the moon, or naming stars.
I don't know enough to make a real judgement, but I can imagine better, more tangible uses for the $6000.
i'd prefer an inanimate carbon rod, thank you.
#2: Completely. I predict that there will be many "green scams" like this in the future.
How about buying that high school kid green transportation for when he goes to college? Or something else tangible that both enriches the kid's life and makes less impact on the environment. Like some sort of green transportation for example.
Buying these carbon offset coupons and thinking you're part of the solution is what's wrong with the world today. The very idea that you can still (mis)use all the resources you want and just pay someone to assuage your guilt is the pinnacle of eco-laziness. I don't know what's more disgusting, buying stuff like this, or not seeing anything wrong with doing so.
And how do you "discount" a product like this?? That should make everyone wary in the first place. If this was a service being provided by people that actually gave a fuck about the environment and weren't in it to make a profit first and foremost, every penny would be going to offsetting those carbons, and there would be no room to offer a discount. What a scam.
If you care so much about the environment to give away $6000, wouldn't you want the people that are receiving that money to be just as committed to the cause?
ehh I had an bad cut and paste in there. Yes I said something about transportation twice. This place really needs an "edit post" button.
I'm reminded of this rather poignant scene from the movie Repo Man. The parents were dope-smokin' hippies in that one too!
Thanks for the interest, guys.
If you read the post
http://www.worldchanging.com/archives/008017.html
we make it pretty darn clear where the money's going:
"The offsets themselves will come from TerraPass, the gold standard company in carbon offsets. TerraPass uses independent verification (including a complete voluntary independent audit), direct sourcing of their offsets (so they know they're for real) and immediate investment (to create offsets now not later)... as well as offering full transparency about their projects. You can't find a better offsetting program than theirs."
You can find out more here:
http://www.terrapass.com/projects/our-principles.html
The discount comes because TerraPass (being a business) usually sells these offsets at what the market will bear, not at cost, but they're cutting us a break because we're a nonprofit and are trying to raise money.
So, before you get your undies in a bunch, no one's getting rich off this (all the benefit goes either to a hardworking non-profit organization working to protect the planet or to a farmer to build a methane digester) and the ecological benefits are not only real, they're transparent and audited.
As for the problems with offsets, perhaps this is useful clarification:
http://www.worldchanging.com/archives//007943.html
Some offsetters are bogus, just like some real estate agents are liars. That doesn't mean you can't buy a good house. There are offsets that work, and that's what people get when they donate to us.
Give some one a treee as a gift that will be planted in a national park. More trees please. Native trees.
And actually, if the kid has a boyfriend or girlfriend, the parents should also consider buying some Cheat Offsets, because long-distance childhood sweethearts don't stand a chance to drunken college orgies.
Cory, will you link to my Online Indulgences site? (All major credit cards accepted)
Well, if you think $6000 is a good deal, I've got an even better one: I'll print out some "carbon credit" certificates on my laser printer and mail them to you for only $500. My certificate program does just as much good for the planet as what these scammers are doing, and is a great bargain at less than 1/10th the price! Hurry up, they're going fast and we have so little time to save the environment!
@SG, Oh yeah? I'll sell these sucke...ahh customers twice as many coupons, for $400!! Let's start a bidding war and devalue the environment even more!!
"Gee, thanks, Mom and Dad. What a thoughtful graduation gift!"
I'm sure some some will argue that the money collected this way goes into projects that someone considers to be "green". But how much?
Can anybody find out what percentage of this money goes to cover "administrative and marketing expenses" (i.e. profit) for World Changing, for TerraPass, for the individual project administrators or for any other brokers, consultants, sponsors or other middlemen?
60%? 75% 90%?
Oh, and let's not forget the cost of the fees paid to their hired "independent" auditors who invariably report that all's well.
Carbon Credits are just a euphemism for "It's okay to pollute if you're rich."
Nice marketing, but all so retrograde. $6000 could buy a very nice & practical bicycle, safety equipment, lock, maintenance contract, and possibly even gym membership for shower access.
Put your child on a baseline low-carbon future.
Just to remind everyone, carbon credits aren't completely imaginary, they're basically hiring someone for the service of taking a certain amount of carbon out of the atmosphere. So if one person's willing to remove that carbon for cheaper, or offer a deal, that would make sense.
The contentious part is that you may be paying someone to do something they'd do anyway - for example if I plant a field of crops and then plow it under, I'm taking carbon out of the atmosphere...but I'd do that either way, so should I be able to sell that service to guilty environmentalists as well?
Overall, the idea has potential, since it creates a new financial incentive for people to do carbon-negative things (now you can sell them!), and provides some impoverished groups like indigenous farmers a way to make money by preserving the environment instead of slashing+burning.
However, the entire idea is predicated on the idea that you have a right to pollute to the extent that you can pay for it, which effectively turns pollution into a privilege of the wealthy. If this model is taken seriously, we'll be looking at a future where the poorest people are living and working in a highly restrictive, environmentally friendly way to take up the slack for the destructive, irresponsible habits of the richest.
Maybe that's more a problem with global capitalism than carbon credits though.
@ #16: "The contentious part is that you may be paying someone to do something they'd do anyway - for example if I plant a field of crops and then plow it under, I'm taking carbon out of the atmosphere...but I'd do that either way, so should I be able to sell that service to guilty environmentalists as well?"
Uh, no. The contentious part is that "carbon offset credits" is a scam.
It's a classic confidence game that preys on peoples' good intentions to sell a massively diluted commodity for full price.
Folks - be careful of this "carbon offset" stuff. One of the most frequently used methods of carbon offset is to plant large eucalyptus farms in developing nations. Impact? Large hectares are taken from productive farmland to sell to carbon offsetters. This is a travesty! Do a google on +"carbon offset" +eucalyptus and educate yourself.
Food wars are coming, and they are going to be caused by those who believe in global warming enough to take farmland for biofuel, carbon offsets, and preventing developing nations from using pesticides and tractors to produce enough food.
"Green" will soon be seen as another imperialist plot..
However, the entire idea is predicated on the idea that you have a right to pollute to the extent that you can pay for it, which effectively turns pollution into a privilege of the wealthy.
THANK YOU.
Does Al Gore's electric bill make a bit more sense, now?
@18: I challenge you to look at TerraPass' transparent operations and identify in public exactly what part or parts of what they're doing is a "scam." Not in vague meaningless terms, like "a massively diluted commodity" (what?) but in concrete step-by-step arguments. How, exactly, are they not delivering exactly what they promise?
Otherwise, by calling what they and Worldchanging are doing a con game, you're essentially just showing yourself to be poorly informed and/or dishonest.
You made the charge: now make it stick or crawl away.
@21 - Alex, I don't know enough yet to take a side in this argument. But someone asked the question about what percentage of what one pays for a carbon offset goes to the actual offsetting, and how much goes to administration, etc? Do you know the answer? Also several people have made the argument that the carbon offset system just gives richer people the right to not feel guilty about polluting. What is the argument to that?
I'm not trying to be antagonistic, just sincerely interested and uninformed.
Thanks, Jake @22. Let me try to clarify.
The breakdown is made in the original post. One half of each donation goes to Worldchanging to support our work in environmental journalism and education. Since Worldchanging is a 501c3 nonprofit, that half is tax-deductible.
The other half goes to TerraPass, who use the money to pay farmers to build waste digesters for clean energy. The details of their program are all available on their site, and they are providing this service below their cost. If they're benefiting here, it's solely by doing a good thing in public view.
No one is making any profit off this, unless you count the farmers, and they need it.
@ #21: "You made the charge: now make it stick or crawl away."
Okay, here goes:
Looking at TerraPass' "transparent operations" as reported on their website, I see no mention of how much of the money they collect actually goes to the various projects they cite, and how much they keep for "administrative costs". As you can imagine, administrative costs are a much-cherished source of revenue for unscrupulous "non-profits". (I'm assuming TerraPass is a non-profit. They aren't so transparent about this.)
And what about the "administrative costs" kept back by their partners, project managers and everyone else in the distribution chain? Hence my remark about a diluted commodity.
I also note that they hired independent firms to audit them. If one of these firm turned in a less-than-stellar audit, they wouldn't get hired again, would they? So much for "independent audit".
Here's a good one: TerraPass has a deal with Enterprise Rent-A-Car, National Car Rental and Alamo Rent A Car to sell you carbon offsets with your car rental. As improbable as it may seen, they feel that the more you drive, the more carbon you offset! And again, how much money do these companies keep for "administrative costs"?
Enough?
@22: Yes, Alex, what exactly is your overhead, and whats your argument against the idea that this whole venture is misguided and asinine?
Several people have already brought up the seemingly rock solid counter-argument, that such money would be vastly better invested in green friendly transportation. How is an 'offset' a better investment than a carbon friendly change of lifestyle?
Please, oh PLEASE, respond to these questions Alex. I'm so poorly informed and I just can't fathom how it could be a good idea to throw my money into a carbon toilet, I just NEED TO GET INFORMED. FOR THE LOVE OF PETE HELP ME ALEX!
Fair enough, Alex. I'll do my research and educate myself a bit.
I don't see anyone arguing that we ought to pay people to offset our emissions INSTEAD of building better systems (green buildings, compact communities, public transportation, zero-waste manufacturing, etc.). We argue for those better systems every day.
Nor are we arguing that people shouldn't lead greener lives. We should all try to save as much energy as we can. But as an average American with currently used systems and currently available technologies, you simply cannot save enough energy by yourself to have no carbon impact. Even if you underwent radical lifestyle reductions (reductions that almost no one is willing to undergo), your share of the public impact (roads, bridges, airports, military, NASA, the health department, the Postal Service, etc.) is larger than a one-planet carbon footprint. That impact is made in your name, with your tax dollars, for your benefit, but you can't change it with what you buy or what you forego. You can, however, offset it and work to change it.
These offsets are quite tangible: farmers build digesters with the money and turn waste into clean energy.
In short: We need to change. A lot. While we pursue big changes, we're still causing damage. Offsets are one way to cause less aggregate damage. We're a nonprofit and need to raise money in order to have conversations like this. Give money and we'll offset some harm.
====
Now as for the offsets themselves, go to TerraPass' principles page and you find the following descriptions with references:
"100% of our carbon offsets are verified against a broadly accepted standard by an independent third party verifier. In 2008 we are adopting the latest version of the Voluntary Carbon Standard (issued in 2007) as our primary standard, because we believe it ensures our customers will get the highest quality offsets available."
"# Our carbon offsets happen in the same year you buy them
It seems like common sense, but it's not common sense at other carbon offset providers, where you could be paying in 2008 for tree-planting carbon dioxide reductions that won't actually happen for as far off as 50 years from now.
When you buy a carbon offset from TerraPass in 2008, the reductions you are paying for are happening when you expect them to happen, in 2008. Global warming is an urgent problem, and we want to make sure that our customers are making a difference now, not far off in the future."
"Every year we publish a list of all the projects we bought carbon credits from in the previous year, including the project name, location, and type, and the exact amount of carbon credits we purchased from that project. This way our customers know exactly where their money goes.
Other carbon offset providers don't do this, so it's difficult and sometimes impossible to know how much they are buying from various projects."
"# Our carbon reductions are verified every step of the way
We were the first carbon offset company in the U.S. to undergo a complete voluntary annual carbon purchasing audit. First, every reduction at every one of our projects gets verified by an accredited third party. Then, once a year, a third party auditor verifies that we are running our business in accordance with standards set by the Center for Resource Solutions, one of the leading authorities on carbon offsets and renewable energy in the US.
We publish the letter issued by that auditor on our web site, so that our customers know that we are buying every ton of carbon we are obligated to buy. This way you know that we get everything checked and double-checked, every step of the way. "
You can go download their reports, the independent auditor's letters, etc.
I don't know what their administrative overhead is normally (on these particular offsets, it's zero, since they're donating them at or below cost), but that's a completely different point that whether the offsets themselves are legitimate.
Unusual (@24) charges that these offsets are scams, and then, being completely unable or unwilling to point to any actual evidence, raises a bunch of other allegations.
First, TerraPass is a for-profit and clear about it, and makes its money by selling things you could only with difficulty buy yourself, like a share in a farmer's waste digester, at a reasonable mark-up. If that's a scam, then he's arguing against capitalism instead of offsets. (though, again, TerraPass is donating these offsets at or below cost.)
Second, all services everywhere have overhead of some sort. I'm sure Mother Theresa had administrative costs. There is no "frictionless" offset or public benefit to be had anywhere: even personal behavioral changes come with opportunity costs. But in this case, we at Worldchanging are not charging any overhead either: 50% of the donation goes to us, and we spend it to do the award-winning nonprofit work we do (and our administrative costs are usually about 10% of our total budget, mostly in the form of an office manager). The donor gets a tax deduction for that 50%
The other 50% goes to pay for the offsets. The farmer gets the money.
The atmosphere gets the benefit.
Update to my post #21 above:
TerraPass, the broker behind WorldChanging's Graduate Pass is indeed a FOR-profit company.
But despite their claims of transparency, TerraPass doesn't want anyone to know how much profit they are making.
"For example, for-profit TerraPass, which has a deal with Expedia, declines to disclose its finances, including its profit, citing competition."
http://www.usatoday.com/travel/news/2007-03-02-offsets-usat_x.htm
Its freakin cold here in Minnesota. Could I buy some carbon credits and burn them for heat?
TerraPass is donating these offsets at or below cost. Alex, I'm not sure what this means... I'm not even sure you know what it means. Their costs could include their salaries and office space. The auditor is also getting paid, we can assume.
The farmer gets the money. He'd better not. That's not what the carbon credits are for, and they should not be considered charity. Assuming the money goes to the digesters, the farmer should also not reap the reward of any energy gains from them. He should continue paying his normal rate, except to TerraPass instead of the energy company. Ideally, TerraPass should reinvest that into other digesters.
What more likely happens is that these carbon credits go straight to the pocket of the farmer (in reduced energy costs) or TerraPass (who are reaping those payments if they don't reinvest).
I am skeptical that this is all heppening. The correct accounting that would need to go into it would be more difficult than Enron (the legitimate parts).
Alex, lengthy cut-and-pastes from TerraPass's website are hardly proof of TerraPass'e veracity. (Nor of the legitimacy of the carbon offset industry as a whole.)
But if I read you right, your answer to my question is that of the $6,000 I spend on a Graduate Pass, World Changing keeps $600 for admin costs plus another $2,400 for other overhead, TerraPass keeps zero, and passes the remaining $3,000 to the farmer.
Is that right? Then how does TerraPass, a for-profit company, make a profit?
Hi all,
This is Adam from TerraPass. A few thoughts here:
- Regarding the "scam" accusation: scam seems to be defined downward here as "something I personally don't like." Everyone, of course, is free not to purchase carbon offsets, but there is hardly anything mysterious going on here. When you purchase (through WorldChanging or through TerraPass directly), you retire a defined amount of carbon offsets. You know exactly what you're getting. We then go and purchase that amount of offsets from one of the clean energy or carbon reduction projects we support.
It's pretty simple. When someone gives us money to do something, and then we go do it, it's hardly a scam. It's sort of the opposite of a scam, actually.
- Regarding where your money is best spent: this of course is a personal decision, and I don't think either WorldChanging or TerraPass is interested in telling you otherwise.
However, there is something a bit odd about the "rock-solid" alternatives people offer up. Green transportation would be a better investment? I did the math on what swapping a Toyota Prius for a Ford Explorer would yield in terms of carbon reductions. Generously, it might be 4 tons of CO2 per year. How about a bicycle instead? Now we're up to about 6 tons, a small fraction of the carbon reduction you'll achieve through the offset purchase.
Which isn't to say you shouldn't go for the bicycle. You should absolutely put your money towards green transportation if that's what most moves you. But this issue is a bit more complex than people tend to acknowledge. As Alex notes, a lot of what we consider "green" living in America is fiddling around the margins, because we're all embedded in an economy that is highly carbon-intensive. Fixing that is going to require both personal conservation and long-term, systemic change.
- Regarding whether carbon offsets turn pollution into a privilege of the wealthy: polluting is presently free to everyone. Offsets are a voluntary purchase. The class-war angle on this just doesn't exist.
It is the case that climate change legislation will tend to raise the cost of energy for everyone, but this has nothing to do with offsets. In fact, offsets could help to ameliorate this issue by transferring money to the poor (who tend not to pollute as much as the rich by virtue of the simple fact that they consume less).
- Regarding the perennial overhead issue: as noted many times now, TerraPass isn't making money on this. I'm not sure how much lower one's overhead can get than that. And no, we're not factoring our rent and Friday beer tab into what counts as an offset expense.
Incidentally, TerraPass is a for-profit, as noted on our web site. Most offset providers, and indeed most organizations in the energy sector, are for-profit.
(This is sort of a tangential point, but overhead ratios are just about the worst possible metric by which to evaluate a non-profit. Again, this has nothing to do with TerraPass. It's just sort of a tragically underappreciated point.)
The Unusual Suspect --
We make a profit that way that every retailer does: with a mark-up on the product we're selling. This is hardly mysterious. In return, we provide value to our customers in the form of quality control, customer service, ease of purchase, etc. It's kind of like when you go to the store and buy something you want. Everyone wins, you know?
The partnership with WorldChanging is a special project we're doing because we happen to support their mission. Again, there's nothing very mysterious about any of this.
As you've conspiratorially noted, we don't disclose our margins. This makes us very similar to...almost every other company in the world. Actually, it makes us similar to a lot of non-profits as well. Non-profit carbon offset retailers don't disclose their margins either (margins and overhead ratio are totally different things).
The boring answer to what keeps our overhead down is: the marketplace. We charge the absolute minimum we can get away with because we operate in a competitive industry. This is bad for us, but good for customers.
@30 Annoyed Capitalist -- I don't quite follow your comment, but I think you might be misunderstanding how offsets work. They have nothing to do with the electricity rates that a farmer pays. The money does in fact go to the project developer. In the case of a methane digester, this would be the farmer who financed the project.
Offsets aren't an investment vehicle. We don't make a return that we can then plow back into other projects. Offsets are more like a direct subsidy to carbon reductions, which would otherwise be financially unsustainable. You're right that this definitely isn't charity, but it isn't like buying stock either.
First off, I'd like to say I appreciate Alex Steffen 's comments and rebuttals. It's not really an easy thing to come back to discuss things on the internet where people can be anonymously openly hostile.
I think the two basic points of contention here (as long as your company is completely legit) is that
A) Even though you say "We all should live greener", carbon offset companies play the role of enabler to consumers that want to continue to pollute. It's like a heroin addict's mother telling them to get off the drugs, but then handing them $50. It doesn't help the addict/consumer change their habits. It's an easy way out, and a poor long-term solution.
B) Carbon offset companies appear to be one of the least efficient, bureaucratic-laden, roundabout ways to go about fixing the environment. Sure I guess it's better than nothing, but like I said, it isn't a long-term answer. You can't crap in your left hand and keep moving it to the right hand without it filling up. I don't think it's a good idea to pacify people's fears with an inviable long-term solution.
As far as Mother Theresa's administrative costs, they'd probably be A LOT less than you'd think. Mostly because there's already a structure in place that pays for and supports what is essentially just a nun on a mission: The Catholic Church. The do the same for hundreds and thousands of other nuns on religious missions. I'd bet the carbon offset companies have had to build a lot of that structure from scratch.
Adam,
Great to see you defending your company here. Would you mind addressing a few issues I have? I alluded to them in a previous comment.
Namely: How do you account for cash flows in your carbon credits? Ideally, you would take my cash and spend it on putting CO2 underground, never to rise to the atmosphere again. Unfortunately, you guys do more interesting projects -- all of which develop cash flows. And because these cash flows don't come back to me, they have to go someplace else. Are you able to guarantee that you capture these cash flows and ensure they are further invested in future projects? How do the auditors address this issue?
#25 Palindromic
Several people have already brought up the seemingly rock solid counter-argument, that such money would be vastly better invested in green friendly transportation. How is an 'offset' a better investment than a carbon friendly change of lifestyle?
Well, it depends on how much CO2 you save, per dollar, with an offset, versus how much you save with green transportation.
That part is pretty simple.
What is not so simple is which saves more, the offset or the "green" transportation. Adam, above, said that a Prius might save about 4 tons of CO2 compared to an Explorer.
So if you are choosing which car to get, you might spend several thousand dollars to save those 4 tons of CO2 a year.
At TerraPass, they are claiming you can save that much for under a hundred bucks.
While it may or may not be true, it's certainly possible. A hundred bucks towards planting trees, investing in green energy, and buying carbon credits from companies so that the polluters aren't able to buy them.
People make it sound like you're just "buying your way out." If I went out in the dirt and planted twenty trees myself, people would say I was en ecological hero. If I pay someone else to do it, I'm "buying Indulgences."
[Offsets] have nothing to do with the electricity rates that a farmer pays. They certainly do if he uses the methane to power generators.
"You should absolutely put your money towards green transportation if that's what most moves you."
Golden pun missed, or uncalled.. tragic.
@35 -- The thing is, this just ain't true. We surveyed our customers. They are an incredibly green bunch. Like, really, really green. They bike to work, put solar panels on their roofs, hang dry their laundry, etc. The "enabler" or "indulgence" argument gets recycled endlessly, but there's just nothing to it.
Also, it misses the bigger point -- the type of projects that offsets fund are in fact the long-term solution. Globally, demand for energy is going to go up and up and up. This is as it should be, because it means the global poor are improving their circumstances. But we need that energy to be clean energy.
Regarding bureaucracy -- I think you may be confusing carbon offset companies with the UN? We're a start-up that bootstrapped ourselves for the first three years of our existence. We got started with a $5,000 loan, which we promptly paid back. If you email our customer support, there's a good chance you'll hear back from a founder. You'd be hard-pressed to find a scrappier organization.
Thanks for the response, Adam.
And thanks for revealing that TerraPass profits from (as you put it) "a mark-up on the product we're selling."
It's unfortunately very difficult to get any sort of financial disclosure from carbon offset sellers. Most people believe that when they pay their money, they are in fact donating to some sort of of environmental charity.
Many carbon offset sellers are pleased to let that misconception continue (no doubt because charities can really rake it in). That's a deceptive practice. And a deceptive practice in the pursuit of profit makes a very fine definition of a scam.
As you said, "It's pretty simple."
Offsets are more like a direct subsidy to carbon reductions, which would otherwise be financially unsustainable. Adam, this comment really scares me. Using the digesters as an example, there are many benefits listed on your site: methane for generators, bedding for cattle, and fertilizer. This means that the farmer, after the installation, will pay less for electricity, invest less in bedding, and pay less for fertilizer. These are cash flows that he will gain every year. These are cash flows that my carbon offset generated. But instead of coming back to me, they are going to the farmer in savings. Thus, you are subsidizing the farmer.
SamSam @ #37: "If I went out in the dirt and planted twenty trees myself, people would say I was en ecological hero. If I pay someone else to do it, I'm "buying Indulgences.""
Well, the ideal is that the guy you would have paid to plant twenty trees does it anyway, while you also plant your twenty trees, and then spend the money you saved on a windmill.
Net result, FORTY trees, TWO ecological heroes AND a new windmill!
The environment likes the second outcome better.
AnnoyedCapitalist, "subsidizing the farmer" is part of the point of projects like this. The goal is generally to build sustainability and support improvements in people's standards of living, not just remove the carbon from the atmosphere. If you're going to insist that all the financial benefits obtained from installing a digester accrue to the offset purchaser rather than the farmer, where exactly is the farmer's incentive to participate in the program?
You point out the "many benefits" in your comment, but if the farmer is forced to transfer any cost savings to an outside investor, those benefits practically disappear. While there are carbon offset programs being designed as investment vehicles, this is not one of them, and it's strange that you insist that it behave as if it was.
Would destroying a neighbor's Hummer or Escalade count as a carbon offset?
With what gas costs, they might be grateful.
This is part of a long term effort to create a new economy based on Carbon Offsets.
Perhaps this is an attempt to make an economy that is more environmentally friendly. Perhaps this is a scheme to combat inflation by absorbing all the excess cash floating around. Perhaps this is another attack on the middle class to keep them from getting rich. Perhaps this is another long range control mechanism that eventually will become obligatory and enslaving for all people.
Ooo, that sounds conspiratorial, but there it is.
Clearly implied in the offer and the comments is the implicit notion that we are all guilty and we "owe" for the Carbon we create. We can pay off our debt by transferring our wealth to someone who will erase our "debt"
Alex Stein:
"polluting is presently free to everyone. Offsets are a voluntary purchase."
Note the words "presently free"
I think that I should pollute less. I want to support people who pollute less. I don't think this should be obligatory, or foster any kind of greater Governmental control over the people by imposition of a sin tax. Such controls might sound necessary and good for Mother Earth, but the sad truth is they will be used to further the control of smaller groups of people over everyone else.
Let's keep up the Green Revolution, but let's do it with our minds engaged and thinking and not out of reactive guilt and "thought free" solutions.
If a bicycle offsets 6 tons, I can buy a lot of bicycles for $6000. Those bikes would not only offset carbon, but reduce health care costs, and turn their users into more engaged and thinking human beings, and best of all, they would be the proactive choice to be more responsible about enivronmental impact. The benefits are too long to list, actually.
google "collectivism"
@ #43 The Unusual Suspect:
That's silly. That's like saying
"I just put a new solar panel on my roof!"
"Wait, did you do it, or did a contractor do it?"
"Um... the contractor did it"
"Well, if you had done it yourself, and the contractor had done it himself, there would have been TWO solar panels! TWO!"
Plus, it's silly to talk about the money "saved" if I did it myself. If my hourly rate is more than the tree planter's hourly rate, I save more money paying him to do it. That money could go towards my next windmill. (If my hourly rate is less than the tree planter's, maybe I should become a tree planter).
google "fud"
You point out the "many benefits" in your comment, but if the farmer is forced to transfer any cost savings to an outside investor, those benefits practically disappear.
That's the freaking point. These farms are businesses -- if they want to save money they should invest in it themselves (which many are now doing ANYHOW). If, instead, the farmer does the math and says "The NPV of the digester is still -$50k, I would need $50k more in order to invest in it" and TerraPass gives them that $50k, then great, that solves my problem. But I see no signs that TerraPass is checking those NPV calculations or doing their own valuations.
Honestly, if we isolate the digester business, I could create my own business plan: Set up a central facility with many digesters. Go around to local farms and collect or buy poo. Let the digesters do their thing. Then sell the electricity, bedding, and fertilizer back to the farmers at market prices. Farmers benefit from the money I give them for the poo they otherwise wouldn't sell. This result keeps the value added in my company, which I further invest in expanding. Any of my investors are essentially buying carbon credits, and also benefit in equity in the company. It could also gain capital from donors of carbon credits.
I would actually be surprised if this kind of business hasn't been tried. It may not be feasible without the free money that carbon credits offer. But the business outlined above ought to satisfy you hippies, and it would satisfy the major issues of cash flows.
People make it sound like you're just "buying your way out." If I went out in the dirt and planted twenty trees myself, people would say I was en ecological hero. If I pay someone else to do it, I'm "buying Indulgences."
Yes. Which is a valid complaint, but I think it points more to an unanalyzed deep discomfort with the mechanisms of global corporatism/capitalism rather than specific ecological issues.
It ain't fair that a few filthy rich people get all the breaks, while masses of absurdly poor people get abused and manipulated. What we're hearing is just that general sentiment applied to the domain where cutthroat capitalism intersects with environmentalism.
The more I read about this the more disgusted I get.
Why do you call these things "carbon credits" in the first place, when really you are asking people to invest in a green friendly infrastructure, one that will surely make a lot of money seeing as these people are donating freely to it?
Why is there no return on this investment, other than getting to feel good about no longer having a "guilty" conscience? Why is giving you money for free any better than giving the homeless and needy people on the streets money? Surely they need it more than you do.
And lastly, the elephant in the room that hasn't been pointed out yet, which is, how can you, or anyone at all, with a basic grasp of science, think that any of these measures is going to have a noticeable effect on the climate? We are infinitesimal in our overall output of CO2, compared to something like the ocean.. Maybe I should start a website to start evaporating the ocean? Send me free money so I can buy expensive equipment to evaporate the ocean people. You can feel good about the "credits" you are saving. All sales are final.
@51 Palindromic:
And lastly, the elephant in the room that hasn't been pointed out yet, which is, how can you, or anyone at all, with a basic grasp of science, think that any of these measures is going to have a noticeable effect on the climate? We are infinitesimal in our overall output of CO2, compared to something like the ocean..
Um, source please? Every reference I've seen says that the ocean absorbs CO2, not emits.
[1], [2]
Further, to say that nothing humans can do can noticeably reduce the amount of CO2 going into the environment is the same as saying that nothing humans are doing now is noticeably increasing the amount of CO2 going into the environment.
If you're building up to a "humans don't cause global warming" argument, just come right out and say it. I don't know if you'll find anyone that would be bothered to argue with you, though.
Guys, let me explain where the problems lie with an example that has numbers:
Say a digester project costs $100k. After it's installed, it provides a savings of $1k per year to the farmer for ten years. Assuming a 10% rate of return, the farmer would only be willing to pay $15k for the project (the NPV given the above savings). [Note that I think the savings are more than this, but this is a good enough estimate]
If TerraPass steps in and pays the full $100k, it is the same thing as paying the farmer $15k today. This is NOT what they should be doing.
If instead, TerraPass does the above calculation and pays only $85k, this mitigates my cash-flow issues. [They might still play with the numbers and pay too much, of course.] However, this also raises another issue: does TerraPass pro-rate the carbon offsets? That is, if they paid 85% of a project, are they only selling 85% of the carbon credits?
Adam, Alex, I apologize if I'm being pedantic. But I have never seen a rigorous financial desctription of carbon offset activities. And the few articles I have read that delve into it are usually done to reveal shady dealings. These are very serious questions you should be able to directly address. You guys are teetering dangerously close to Enron-type accounting.
@#47 SamSam: "That's silly. That's like saying
"I just put a new solar panel on my roof!"
"Wait, did you do it, or did a contractor do it?"
"Um... the contractor did it"
"Well, if you had done it yourself, and the contractor had done it himself, there would have been TWO solar panels! TWO!""
I checked; one plus one still equals two.
SamSam: "Plus, it's silly to talk about the money "saved" if I did it myself. If my hourly rate is more than the tree planter's hourly rate, I save more money paying him to do it. That money could go towards my next windmill. (If my hourly rate is less than the tree planter's, maybe I should become a tree planter)."
How can money you pay to someone else cost you less than money you pay to yourself? Or, if you are referring to Opportunity Costs (money you would have earned elsewhere if you were not out planting trees), do it on your day off.
@#52 SamSam: "Um, source please? Every reference I've seen says that the ocean absorbs CO2, not emits."
The oceans are a major player in the carbon cycle both in the uptake and the release of CO2:
http://en.wikipedia.org/wiki/Carbon_cycle#In_the_ocean
What would be the effect of giving your kid $6K for a down payment on a hybrid or electric vehicle? Would that offset more carbon over the life of the vehicle than the 'guilt credits' and would you then have a car to drive around?
http://www.publicaffairs.noaa.gov/releases2003/oct03/noaa03-131.html
The oceans aren't just a major player, they are pretty much the only player you have to worry about.
Maybe I am going in the direction of disputing man made global warming, but as you said, I would find very few people who would bother to argue with me. Most people are just so sure that the debate is over, because Al Gore said it was. Thus negating any reason to even raise questions about the validity of computer generated models that can't account for even a fraction of the actual variables at play, why we can't explain what caused the various global shifts in climate that occurred over the millions of years without dipping into a grab bag of vagaries and probablys, why the "science" behind the theory of AGW is so easily and readily attacked (gasp, could it be that we don't yet fully understand how massive scale atmospheres like the Earth really work at the end of the day??)
What would be the effect of giving your kid $6K for a down payment on a hybrid or electric vehicle?
That's a very interesting question. According to the rates on TerraPass, the average difference between hybrid and non-hybrid emissions is 6,000 lbs/year. This is worth $29.70/year in carbon offsets. Difference in gasoline costs (half of say $3.5/gal of 12k miles per year on 40mpg instead of 20mpg) which are about $1,050 per year. Using the Honda Civic as a model, the average price of a hybrid is $7,500 more expensive than the non-hybrid. You'll help save the kid $1,080 per year (assuming he buys offsets) if he pays $1,500 extra on the car.
So since hybrids only save $30/year in carbon offsets, that alone is not much of an incentive to buy one. There's also not much of an incentive based on gasoline costs, either, unless you plan on it not breaking for ten years.
Ah, I just saw that TerraPass was started by Wharton students. No wonder you guys play so fast and loose with those finance terms.
Here's a theoretical.
There's a company with its own wind farm whose parking lot and offices are roofed over with solar panels.
They pipe the juice into a condenser which sucks CO2 out of the air and turns it into inert bricks.*
Would an offset certificate from them be acceptable?
Adam Stein -
Thanks for your comments, and I do approve of what TerraPass is trying to do. On the other hand, when will TerraPass start investing in changed-behavior projects? For example, if someone can offer measured & verified carbon reductions from a cluster of odometer-enabled cyclists for a designated period, how could they tap into a TerraPass investment?
re: #55 Antinous, see my comment #16. Like minds, eh? :-)
worst present ever